Electronic Arts ($EA) Stock | Falling Hard After Earnings Report


Electronic Arts Inc. (NASDAQ: EA)



On Thursday January 28, 2016, Electronic Arts Inc.- the widely popular and second largest video game manufacturer in the world-  reported their quarterly earnings after the market closed. Like many other companies missing expectations or actual earnings projections, shares fell hard and sold off sharply in the aftermarket session . While shares closed up $0.30 to $69.79 in the regular trading session-shares plummeted almost 8% closing at $64.25 in the aftermarket session.


Electronic Arts Earnings

The Company  reported it generated  a loss of $45 million, or 14 cents a share, down from a profit of $142 million, or 44 cents a share, in the same period last year. The company expects to deliver earnings of 40 cents per share on revenue of $875 million for the quarter ending March 31. Wall Street estimates earnings of 50 cents per share on $915.41 million.- Yahoo/Reuters As was  expected from sales of copies of Star Wars Battlefront in the month of December at holiday shopping season, revenues were well above previous forecasts. This was one of the great spots contained in the earnings report.


EA Chart

EA Chart

In the accompanying chart you will see the daily price action from the beginning of last year 2015. Please note the 45 degree upward trend line that the share price has respected along its way. However after Thursday’s  earnings report shares will  open significantly lower- likely in the circled area with red arrows. Where it will wind up at the close of Friday’s trading is anyone’s guess- but many traders eyes will be watching this one as they are a leader in the industry.


Company Comments

“We sold more in the third quarter than we thought we would, so possibly there will be less in the fourth quarter than we originally thought,” Chief Financial Officer Blake Jorgensen said in an interview.- Reuters


These comments however was not  comfort for  traders and investors as skepticism is growing for the upcoming earnings quarter


Company Profile

Electronic Arts Inc. develops, markets, publishes, and distributes game software content and online services for video game consoles, Internet-connected consoles, personal computers, mobile phones, and tablets worldwide. The company operates through EA Studios, EA Mobile, and Maxis divisions. It develops and publishes digital interactive entertainment games primarily under the The Sims, Madden NFL, EA SPORTS FIFA, Battlefield, FIFA Soccer, Need for Speed, Dragon Age, and Plants vs. Zombies brand names. The company also offers casual games, such as cards, puzzles, and word games through pogo.com and on other platforms; and sells digital content. The company was founded in 1982 and is headquartered in Redwood City, California.